Is it too late to consider buying Marriott Vacations Worldwide Corporation (NYSE:VAC)?
Marriott Vacations Worldwide Corporation (NYSE: VAC), isn’t the biggest company out there, but it got a lot of attention in recent months due to a substantial price increase on the NYSE. While it’s good news for shareholders, the company has traded much higher over the past year. Because many analysts cover mid-cap stocks, we would expect that price-sensitive announcements have already been factored into the stock price. But what if the stock is still a bargain? Let’s take a look at Marriott Vacations Worldwide’s prospects and value based on the most recent financial data to see if the opportunity still exists.
Check out our latest analysis for Marriott Vacations Worldwide
Good news, investors! Marriott Vacations Worldwide is still a buy right now according to our price-multiple model, which compares the company’s price-to-earnings ratio to the industry average. We used the price-to-earnings ratio in this case because there is insufficient visibility to predict its cash flows. The stock’s ratio of 16.64x is currently well below the industry average of 25.09x, meaning it is trading at a lower price than its peers. Although there may be another chance to buy again in the future. This is because Marriott Vacations Worldwide’s beta (a measure of stock price volatility) is high, meaning its price movements will be exaggerated compared to the rest of the market. If the market is bearish, the company’s shares will likely fall more than the rest of the market, providing an excellent buying opportunity.
Investors looking for growth in their portfolio may want to consider a company’s prospects before buying shares. Buying a great company with a robust outlook at a cheap price is always a good investment, so let’s also take a look at the company’s future expectations. Marriott Vacations Worldwide’s profits are expected to rise 50% in the coming years, indicating a very optimistic future. This should lead to more robust cash flows, leading to a higher share value.
Are you a shareholder? Since VAC is currently trading below the industry’s price-to-earnings ratio, it could be a good time to increase your stock holdings. With a positive earnings outlook on the horizon, it appears that this growth has not yet been fully reflected in the share price. However, there are also other factors to consider, such as capital structure, that could explain the current price multiple.
